Tue Mar 31 00:42:47 UTC 2026: ### Headline: Parliamentary Committee Flags Slow Utilisation of Central Funds Despite Reformed System

The Story:
A Parliamentary Standing Committee on Public Grievances, Law and Justice has raised concerns about the sluggish utilisation of funds allocated under Centrally Sponsored Schemes (CSS) for judicial infrastructure. Despite the implementation of SNA-SPARSH (System for Payments and Reporting Across Sectors Holistically) in January 2024, a just-in-time (JIT) funding system designed to expedite fund disbursement, significant amounts of allocated funds remain unspent. This issue extends beyond judicial infrastructure, impacting various sectors and resulting in unrealised development goals.

Key Points:

  • The Parliamentary Standing Committee has flagged concerns regarding the slow utilisation of CSS funds for judicial infrastructure.
  • India had Rs 1,60,000 crore of unspent welfare money sitting in bank accounts as of December 2024.
  • SNA-SPARSH, launched in January 2024, aimed to improve fund disbursement efficiency.
  • Unutilised funds decreased from 42% in 2024-25 (Rs 1.6 lakh crore) to 18% (Rs 69,000 crore) by December 2025 due to SNA-SPARSH.
  • 38 out of 50 reported schemes utilised less than 50% of their allocated budget by December 2025.
  • While SNA-SPARSH improved fund flow, utilisation rates remain low due to procedural and physical bottlenecks at the implementation level.
  • A CAG report on PMAY-R for Tamil Nadu highlighted issues like manual processes, multiple verification levels, and errors in beneficiary bank-account mapping.

Critical Analysis:

The historical context provided, while diverse, contains relevant threads. The March 31, 2026 report of a 2023 CAG report tabled in HP Assembly, flagging fund misutilisation and delays, directly resonates with the primary article’s core issue. This indicates that the problem of fund mismanagement and delayed utilisation is a recurring one, not isolated to a specific scheme or time period. The SNA-SPARSH system aimed to address these issues, but the persistence of low utilisation rates suggests systemic problems beyond fund disbursement, as also pointed out by the 16th Finance Commission.

Key Takeaways:

  • Despite efforts to streamline fund disbursement through initiatives like SNA-SPARSH, significant challenges persist in ensuring timely and efficient utilisation of CSS funds.
  • The bottlenecks are now identified to be at the implementation level, involving procedural inefficiencies, manual processes, and verification hurdles.
  • Digital PFM principles like observability, rule-driven workflows, and real-time processing are crucial for improving CSS implementation.
  • Simply releasing funds faster does not automatically translate to faster spending or improved outcomes.
  • There is a need for better mechanisms to wind down schemes that have run their course, based on credible evidence of spending efficiency.

Impact Analysis:

The continued slow utilisation of CSS funds has significant long-term implications. It hinders the achievement of developmental goals, delays crucial infrastructure projects, and ultimately impacts the well-being of citizens. Without addressing the identified implementation bottlenecks, the effectiveness of government programs and the credibility of public financial management will be undermined. The shift towards digital PFM principles is crucial for achieving tangible improvements and ensuring that allocated funds translate into real-world benefits.

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